from the that'll-work dept

Taking a page from the telecom and banking sector playbooks, New York City hotels have decided to add a $25 "destination fee" just for the honor of being able to sleep somewhere near the audio visual cacophony that is Times Square. Major hotel chains like Hilton, Marriott and Starwood are all adding the new destination fees, which aren't part of the advertised rate -- and are only added to the final tally at checkout. Said fees mirror other "resort fees" used to jack up advertised rates in other destination locations like Hawaii, the Florida coast, or Las Vegas.

"But this week, a guest booking a room at the Hilton New York was alerted as he finalised payment that a “Daily Mandatory Charge” of $25 would be added to the room rate, covering an “Urban Destination Charge”, “premium” internet access, local and freephone calls, and a total of $25 credit for food and drink in the hotel.

The credit, it turned out, is a one-off figure – though the Urban Destination Charge is due every day of the stay."

If you've paid attention to the problems in the telecom sector, you've probably realized that this is now standard industry procedure. Cable and phone companies alike often make up entirely nonsensical fees (with names like the Internet Cost Recovery fee or Broadcast TV fee) with the express goal of advertising one price, then charging another. To add insult to injury, they'll then crow about how their advertised rate has remained the same from year to year. That's been an obvious case of false advertising for going on a decade, yet legal or regulatory accountability for the misleading charges remains elusive at best.

In telecom, the FCC had made a little noise about cracking down on the misleading surcharges in the form of a "nutrition label" for broadband that would clearly disclose any caveats, but that effort appears to have stalled. In the hotel industry where competition makes such action less pressing, the FTC gave hotels a fairly tepid warning about the practice in 2012, stating that the practice of hidden fees "may be deceptive" and "may violate the law." Hints that a new FTC crackdown on the practice was coming similarly emerged last year, only to apparently disappear back into the swamp of regulatory intent and good intentions.

Just like in the telecom industry, when hotels are asked whether jacking up the advertised rate post sale could be construed as predatory and obnoxious, they'll usually trot out some rubbish about how the practice enhances the "customer experience." Take this bit of prattle from Starwood owners Marriott International, for example:

"The Destination Fee was created as a way to lift the guest experience by providing added value to a hotel stay. Each hotel may offer a combination of hotel services (such as dry-cleaning, pressing or a food & beverage credit); local experience vouchers for free/discounted events and attractions (such as city tours), and/or access to fitness programs (such as yoga or cycling) in nearby studios..."The implementation of the Destination Fee gives us the opportunity to test how a bundle of benefits that our research shows are valuable to guests might enhance the stay."

Of course that's bullshit, since not knowing what the hell you'll actually be paying for your room kind of puts a damper on the entertainment value of the whole affair, and users are usually docked these fees regardless of whether they use amenities or not. The goal again is to falsely advertise a lower rate, full stop. That may be a problem for competitors foolish enough to clearly advertise their real rates, since they superficially could appear to be a worse value. On the flip side, hitting your visitors with obnoxious, hidden fees is a wonderful way to help drive business to the share economy competitors these companies have been whining about for the better part of a decade.

from the and-why-ben-thompson-should-too dept

Long time readers of Techdirt may know (as I've noted several times), that in the mid-2000s when the net neutrality debate was first heating up, I was against the FCC putting in place rules to protect net neutrality. As I explained at the time, the concept of net neutrality was important, but I had so little faith in the FCC that I expected any rules it put together would cause more harm than good. I similarly argued that the fight over net neutrality was really a symptom of a larger problem (the lack of competition in the broadband market), rather than the problem in itself. I was also heavily influenced by a paper that Professor Ed Felten wrote in 2006 called Nuts and Bolts of Network Neutrality, which mostly (as the title suggests) goes through the various arguments for and against net neutrality rules. But it concludes with a position I agreed with for a while: that while net neutrality was important, actual rules that protected it would be tricky to get right -- and the "best" policy might just be the "threat" of rules should broadband providers engage in bad behavior. Thus, that threat, might prevent bad behavior, without having to put in place bad rules:

Net neutrality advocates are right to worry that ISPs can
discriminate—and have the means and motive to do so—in ways that might be difficult
to stop. Opponents are right to say that enforcing neutrality rules may be difficult and
error-prone. Both sides are right to say that making the wrong decision can lead to
unintended side-effects and hamper the Internet’s development.

There is a good policy argument in favor of doing nothing and letting the situation
develop further. The present situation, with the network neutrality issue on the table in
Washington but no rules yet adopted, is in many ways ideal. ISPs, knowing that
discriminating now would make regulation seem more necessary, are on their best
behavior; and with no rules yet adopted we don’t have to face the difficult issues of linedrawing
and enforcement. Enacting strong regulation now would risk side-effects, and
passing toothless regulation now would remove the threat of regulation. If it is possible
to maintain the threat of regulation while leaving the issue unresolved, time will teach us
more about what regulation, if any, is needed.

So, what changed, leading me to eventually move to supporting the Open Internet Order of 2015? Well, as Felten predicted (he's good at that sort of thing...), the market continued to develop, legal precedent got set, and we got a lot more information on what was happening. On top of that, we got decent (though not perfect) rules from the Wheeler FCC, which were non-burdensome, and did quite a lot of good.

I wanted to explore in greater detail what it was that made me change my opinion on this -- and I'll do it while also countering someone else's arguments. A bunch of people have been pointing me to what Ben Thompson from Stratechery has been saying about net neutrality over the past couple weeks. Ben is very smart and extraordinarily insightful on issues related to innovation and policy, and I probably agree with him about 85% of the time. Thus I do find it interesting to explore where we disagree -- and net neutrality is one of those places. But what's most interesting to me is that after going through Ben's thoughts on this multiple times, I think that he's really in the place I found myself a decade ago -- supporting net neutrality, but being wary of the FCC's implementation. So, as part of my reasoning for why I changed my mind, I'll also try to explain why Ben should change his mind as well. If you haven't followed Ben's statements here's his original blog post, which was initially called "Why Ajit Pai is Right," but was later changed to "Pro-Neutrality, Anti-Title II."

His second blog post on it was entitled The Broadband Tradeoff; The Importance of Antitrust. Finally, he did a podcast discussing his views called Two Terrible Options, which focuses on the supposed "tradeoffs" between the current rules and Pai's plan, arguing that he thinks Pai's plan is better for actually keeping net neutrality. But he, unfortunately, bases that conclusion on a series of incorrect or misleading facts, some of which I'll try to correct below.

Ben's starting premise -- which I agree with -- is that there are tradeoffs to any regulations and he, like me, comes from a starting place of being skeptical of the need for regulation without significant evidence that it is necessary.

Any regulatory decision — indeed, any decision period — is about tradeoffs. To choose one course of action is to gain certain benefits and incur certain costs, and it is to forgo the benefits (and costs!) of alternative courses of action. What makes evaluating regulations so difficult is that the benefits are usually readily apparent — the bad behavior or outcome is, hopefully, eliminated — but the costs are much more difficult to quantify. Short-term implementation costs may be relatively straightforward, but future innovations and market entries that don’t happen by virtue of the regulation being in place are far more difficult to calculate. Equally difficult to measure is the inevitable rent-seeking that accompanies regulation, as incumbents find it easier to lobby regulators to foreclose competition instead of winning customers in an open market.

Ben's second point, then, is on the difference between ex ante (beforehand) and ex post (afterwards) regulatory regimes, noting that ex post regimes can allow for more experimentation that can be good:

I absolutely support regulation of ISPs and the preservation of the neutrality (at least in terms of blocking content), I just think we should stick to ex-post instead of ex-ante until there is compelling evidence of systematic abuse.

And, again, that was my position more than a decade ago, and remained as such for quite some time. Here's why I've changed my mind. First, Ben's position (and the position of everyone, including Ajit Pai) who insist that there's no evidence of "systematic abuse" are (conveniently) ignoring (or are unaware of) the long history here. This is not a situation where broadband providers have shown no interest in abuse. They have regularly and clearly stated their intent to systematically abuse their dominant position in the market. As we've discussed, this goes back to AT&T's former CEO Ed Whitacre declaring, back in 2005, his intent to charge edge providers for daring to be what his broadband subscribers demanded from the network:

"Now what they would like to do is use my pipes free, but I ain't going to let them do that because we have spent this capital and we have to have a return on it. So there's going to have to be some mechanism for these people who use these pipes to pay for the portion they're using. Why should they be allowed to use my pipes? The Internet can't be free in that sense, because we and the cable companies have made an investment and for a Google or Yahoo! or Vonage or anybody to expect to use these pipes [for] free is nuts!"

But -- Pai, Ben and others may retort -- since then there hasn't been any evidence of them actually doing so. First off, that's not entirely true. There is a decently long list of examples of bad behavior by broadband providers (though Pai and his supporters like to dismiss those as anomalies). But the more important point is that it's always been the Feltenesque threat of rules that have kept the big broadband providers in check. Because it was right around the time that Whitacre announced his intention to start charging edge providers, that then FCC chair Michael Powell had released his guiding principles paper on "preserving internet freedom" that noted the FCC needed to "keep a sharp eye on market practices" to stop broadband ISPs from doing things like blocking competing services. And, soon after that, the FCC fined Madison River for blocking VoIP services.

In other words, the FCC had made it clear that it would crack down on such bad behavior that the big broadband players had clearly stated they planned to engage in. Of course, what followed after that was a series of attempts by the FCC to enforce such rules against other abuses, where the courts repeatedly told the FCC that it didn't have the authority to punish the broadband providers if they were classified as Title I information services. So, you have to know all of this history to understand the threat of systematic abuse. Ben claims that there's no evidence of it, but that's not true. There are the stated intentions of the broadband companies to abuse net neutrality. Beyond the Ed Whitacre statement above, during one of the lawsuits against the FCC (filed by Verizon over the 2010 rules), the company flat out said in court that it intends to violate net neutrality and would do so if the rules were not in place:

"I'm authorized to state by my client today that but for these rules, we would be exploring those types of arrangements," Verizon's attorney, Helgi Walker, said at the time.

So, again, we have multiple examples of the broadband players directly saying that they would violate net neutrality if given the opportunity -- repeatedly held in check by an FCC that tried to set rules saying it wasn't allowed. But eventually, the courts made it clear that such rules were not enforceable under Title I, and the only way to make rules that stick is under Title II, which the Tom Wheeler Open Internet Order finally did.

In other words, the big broadband providers have been clear that they intend to violate net neutrality. They were only held in check by the FCC, but the courts had twice thrown out attempts at rules, until Wheeler reclassified to Title II -- which the courts have since blessed. Given that history, it's reasonable to shift from my Feltonian position of a decade ago to one where it seems fairly obvious that if we are to keep neutrality, we need Title II to make it work. That's exactly what the courts have said.

That's not the only reason either. Another thing that had become clear over the intervening decade was that these broadband companies had only grown larger, more dominant and more powerful -- along with a long history of horrible customer care (being so dominant does that) and outright nefarious behavior (leading to various fines). Going back to the Powell days, where he insisted that broadband-over-powerlines was the Great Broadband Hope for competition, we've seen consistently less and less competition in the broadband realm.

In short, the situation has consistently gotten worse on the competitive front, at the same time the big players have insisted that they intend to initiate bad behavior, and the only check against that bad behavior (the possibility of rules from the FCC) got shot down in the courts until they were reclassified as Title II. Put all that together, and if you support net neutrality, as Ben claims to, there's almost no argument against Title II.

But, while we're at it, we need to correct a few other misconceptions put forth by Ben (and some other supporters of Pai's plan). First, is the idea that this can all be dealt with via antitrust and the FTC. As we noted recently, depending on the outcome of an AT&T lawsuit, the FTC may be blocked from having any regulatory say over broadband providers as well. Relying on the FTC is unlikely to solve many of the problems put forth by violating net neutrality, because they don't fall under areas where the FTC can regulate -- whether it's false advertising/misleading users or outright scams.

Ben, somewhat oddly, makes a number of other factual errors during his podcast. He claims that the 2015 rules have really only caused problems for small ISPs because of the burdensome cost of those regulations. That's... wrong. A whole bunch of those ISPs told the FCC they want the rules to remain. They're not the ones agitating to remove the rules. Indeed, they point out that by killing the rules and consolidating the power of the giant broadband players (i.e., AT&T, Verizon, Comcast) it creates an even more unfair market. Those giants can craft deals with internet services and companies that make it harder for the smaller ISPs to compete.

Along those same lines, Ben insists that the 2015 rules are obviously costly in compliance terms. But there is no compliance issue. There's nothing you need to do to comply other than not block, not prioritize, and not throttle. If you read the 8 pages of actual rules, there's no compliance issue if you're not violating net neutrality. As one small ISP, Sonic, has noted, the 2015 order is only a regulatory burden if you plan to violate net neutrality. And that's because there are some provisions for services that want to violate net neutrality, whereby they'd need to ask the FCC for permission to do so:

The Commission may waive the ban on paid prioritization only if the petitioner demonstrates that the
practice would provide some significant public interest benefit and would not harm the open nature of the
Internet.

Another point that Ben and others have raised, partially correctly, but mostly misleadingly, is that the key issues that people point to recently on the net neutrality front: interconnection disputes and zero rating, were not covered by the 2015 order. In one sense, this is accurate. Indeed, one of our big complaints with the 2015 rules was that they left these loopholes in place. But... that's not (as Ben suggests) a reason to ditch those rules. After all, literally days after the new rules were voted on, the big broadband players magically ended all their interconnection disputes. And that's because they knew that without fixing that, they'd face net neutrality complaints, and the FCC would almost certainly find those efforts to violate open internet principles.

As for zero rating? Well, Ben insists in his podcast that the lack of any FCC authority over that meant that the rules don't matter. Apparently, he missed the fact that the Wheeler FCC actually told companies that zero rating was anti-competitive late last year, telling AT&T it needed to knock it off. Of course, it was easy for people who don't follow this stuff to miss, because one of Ajit Pai's first moves upon taking over from Wheeler was to tell AT&T not to worry about that complaint.

This also highlights another error that Ben made in his writing and podcast. In the podcast, he keeps insisting that the difference between Title II and Title I is ex ante v. ex post rulemaking. Specifically, he argued that using Title II is silly because it only allows preset rules, and doesn't allow for "ex post" rulemaking to go after new bad behavior (citing interconnect and zero rating as examples). But, as we just pointed out in the previous paragraph, under Title II, the FCC could still make some ex post rulings on bad behavior that went against net neutrality (which is also why the interconnection fights disappeared -- because companies knew the FCC would find it problematic). What Ben misses is that under Title I, there's basically no "ex-post" process at all. The Pai FCC is washing its hands of any authority or any concern for neutrality at all (removing even the Feltonian "threat" of rules), and handing it off to the FTC which may not have any authority at all, and if it does, fairly limited authority that can't go after much of the promised bad behavior.

On top of that, there's much more uncertainty without the rules -- and uncertainty itself can be a pretty large regulatory barrier. The rules set out principles and key issues that the FCC believe in about the internet. And they allowed the FCC to step in "ex post" to correct behavior that violated those principles. But under the new lack of rules, there are no such principles. And while the FTC may step in, ex post, to go after some really egregious behavior, it's not clear what it will focus on (if anything) or why. That leads to much greater uncertainty than the set rules of the 2015 Open Internet Order.

During the podcast, Ben also suggests that the FCC's "success" in getting Comcast to stop throttling BitTorrent (pre-Title II) shows that we don't need Title II, and that the FCC's ex-post orders under Title I were sufficient. Except, once again, that ignores the actual history here. Yes, Comcast stopped throttling BitTorrent. But it took the FCC to court and won. So, what "worked" back in 2008 would not work the next time. It's odd to claim that the FCC succeeded against Comcast when it lost the lawsuit. Comcast didn't go back to throttling BitTorrent because other net neutrality rules were still pending (and because the company had agreed to some temporary net neutrality conditions for mergers. But those will go away).

I'll just end with one final oddity from Ben's position. During the podcast, he argues (as we have argued for a long time) that getting more competition should be the focus -- and to get there he's specifically a supporter of local loop unbundling. That's the process by which the service layer is separated from the infrastructure layer and you can have multiple service providers offering service on the same fiber. I'm all for that as well. It's what we had in the dialup days when there was a ton of competition. But... amazingly, what Ben seems unaware of, is that the law that enables local loop unbundling is Title II. It's right there in Section 251(3). Of course, it's important to note that the Wheeler order (unfortunately) deliberately promised not to make use of this part of the law (via "forbearance"). But moving away from Title II is, by definition, moving away from local loop unbundling. So to say you're against Title II, but for local loop unbundling is just... strange.

The larger point here, though is that while there certainly were a number of reasons to be hesitant about supporting Title II or even explicit rules from the FCC a decade ago, enough things have happened that if you support net neutrality, supporting Title II is the only current way to get it. Ajit Pai's plan gets rid of net neutrality. The courts have made it clear. The (non) competitive market has made it clear. The statements of the large broadband providers have made it clear. The concerns of the small broadband providers have made it clear. If Ben does support net neutrality, as he claims, then he should not support Pai's plan. It does not and will not lead to the results he claims he wants. It is deliberately designed to do the opposite.

So, yes. For a long time -- like Ben does now -- I worried about an FCC presenting rules. But the courts made it clear that this was the only way to actually keep neutrality -- short of an enlightened Congress. And the deteriorating market, combined with continued efforts and statements from the big broadband companies, made it clear that it was necessary. You can argue that the whole concept of net neutrality is bad -- but, if you support the concept of net neutrality, and actually understand the history, then it's difficult to see how you can support Pai's plan. I hope that Ben will reconsider his position -- especially since Pai himself has been retweeting Ben's posts and tweets on this subject.

Update: And... just as this post was going live, Pai was, once again, tweeting about Ben's post, even though Pai must know that Ben's claims are wrong, and Pai's plan does not match with what Ben claims:

from the good-deals-on-cool-stuff dept

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from the but-reserves-option-to-do-it-again-to-someone-else dept

Earlier this year, government entities in Beaverton, Oregon got fed up with a resident's refusal to stop pestering them about problems with their traffic light timing. Mats Jarlstrom, a red light camera ticket recipient and consequential thorn in the side of local pols, tried repeatedly to get state traffic engineers to take a look at his research on yellow light timing. They refused. And they refused in a way only powerful bureaucracies can.

The Oregon Board of Examiners for Engineering and Land Surveying told Jarlstrom to shut up by issuing him a $500 fine for practicing engineering without a license. It was, of course, bullshit. Jarlstrom couldn't alter traffic light timing and certainly wasn't sending in bids for government work while presenting himself as an engineer. He just wanted to talk about his research. But the state board wasn't interested in his work or his refusal to stop talking. Despite holding a bachelor's degree in electrical engineering, Jarlstrom was told he wasn't enough of an engineer to talk about subjects he'd thoroughly researched.

A state panel violated a Beaverton man's free speech rights by claiming he had unlawfully used the title "engineer'' and by fining him when he repeatedly challenged Oregon's traffic-signal timing before local media and policymakers, Oregon's attorney general has ruled.

Oregon's Board of Examiners for Engineering and Land Surveying unconstitutionally applied state law governing engineering practice to Mats Järlström when he exercised his free speech about traffic lights and described himself as an engineer since he was doing so "in a noncommercial'' setting and not soliciting professional business, the state Department of Justice has conceded.

Jarlstrom will get a $500 refund from the state, but perhaps more importantly, an admission of wrongdoing -- a rarity in litigation settlements. Jarlstrom and the Institute for Justice would like to see further changes made in the state's government. They want the court [PDF] to review the laws used to silence Jarlstrom and find them unconstitutional. The state, unsurprisingly, does not. Its settlement offer [PDF] wants awards limited to its admission of wrongdoing and a refund of the fine paid by Jarlstrom. The state would still like to be able to declare who is or isn't an engineer. But it's already been used as a weapon against a critic once. There's nothing in the board's settlement offer that would prevent it from doing it again.

from the disinformation-nation dept

For a decade now one major ISP talking point against net neutrality is that it hurts the sick and disabled. Verizon, for example, has tried to pretend that net neutrality rules hurt the hearing impaired because it prevents them from getting access to prioritized medical services like video relay or other technologies. Comcast has frequently trotted out this argument as well, as in an FCC filing (pdf) earlier this year claiming that net neutrality rules simply must die because they're preventing the sick and disabled from getting access to advanced telemedicine technologies:

"...the Commission also should bear in mind that a more flexible approach to prioritization may be warranted and may be beneficial to the public. For example, a telepresence service tailored for the hearing impaired requires high-definition video that is of sufficiently reliable quality to permit users “to perceive subtle hand and finger motions” in real time. And paid prioritization may have other compelling applications in telemedicine. Likewise, for autonomous vehicles that may require instantaneous data transmission, black letter prohibitions on paid prioritization may actually stifle innovation instead of encouraging it."

You may be shocked to learn that this isn't, nor has it ever been, true. Both the discarded 2010 rules, and the 2015 rules, carve out mammoth, tractor-trailer-sized exemptions for medical services. In the 2015 rules, the FCC was careful to distinguish between "Broadband Internet Access Services (BIAS)" (generalized internet traffic like browsing and app data) and "Non-BIAS data services," which are often given prioritized, isolated capacity to ensure lower latency, better speed, and greater reliability. VoIP services, pace makers, energy meters and all telemedicine applications fall under this category and are exempt from the rules.

You'll be equally shocked to learn that this has nothing to do with helping the sick -- and everything to do with making more money. ISPs want to eliminate the paid prioritization restrictions so they can sell content and service companies an unfair advantage in the market. Deals that give industry giants prioritization, optimal routing and the lowest latency, while startups, non-profits and educational institutions sit twiddling their thumbs at a notable disadvantage. This goal is precisely why Comcast is already walking back its promises on this front as repeal nears.

You'd think, as FCC Boss so immensely familiar with the rules he's so eager to dismantle, that Ajit Pai would realize that the claim that net neutrality hurts the sick is a dated and grotesque bit of scare mongering. Yet last week, as he tried to defend himself from massive criticism that he was selling out consumers and the health of the internet, Pai gave yet another speech (pdf) during which he doubled down on the idea:

"By ending the outright ban on paid prioritization, we hope to make it easier for consumers to benefit from services that need prioritization -- such as latency-sensitive telemedicine. By replacing an outright ban with a robust transparency requirement and FTC-led consumer protection, we will enable these services to come into being and help seniors."

Again: there is no "outright ban," and the rules clearly already carve out giant holes for this traffic. Not to be outdone, this claim that killing net neutrality magically helps the sick was also included in the FCC's facts-optional fact sheet (pdf) it circulated last week to "set the record straight":

"FACT: Restoring Internet freedom will lead to better, faster, and cheaper broadband for consumers and give startups that need priority access (such as telehealth applications) the chance to offer new services to consumers."

But again, nothing in the rules stopped this from happening already, meaning that Pai once again feels the need to lie about something that can be fact-checked by anybody willing to spend a little time actually reading the 2015 rules (pdf). Of course when you're pushing what's potentially the most despised bit of tech policy kerfuffle since SOPA with little to no support from the actual public, manufactured bogeymen are apparently all that's left to fall back on.

from the results-are-inconclusive dept

A rather strange ruling has been handed down by the Sixth Circuit Appeals Court. It's a ruling that could have an adverse effect on anonymous speech, although it does mitigate the potential damage by booting it back to the lower court for a final determination. But that still might not stop an aggrieved multi-level management company from learning the identity of one of its critics.

Signature Management Team is the plaintiff/pyramid scheme. John Doe posted a link to a copy of one of SMT's books on his "Amthrax" blog. SMT filed a DMCA takedown notice with the blog's hosting service, Automattic. After being served with the notice, Doe removed the link to the copyrighted instruction book.

This quick concession didn't stop SMT from suing Doe. It alleged one count of copyright infringement. Doe asserted a fair use defense and alleged copyright misuse, i.e., the use of copyright to silence a critic. He also asserted his right to speak anonymously and argued against being unmasked.

SMT moved to compel disclosure of Doe's identity. The district court agreed with Doe, feeling Doe had a chance to prevail with his fair use argument. It did compel Doe to reveal his identity to the court and issued a protective order preventing SMT from learning his identity.

Unfortunately, Doe did not prevail in this legal battle. The court denied summary judgment to Doe, siding with SMT on its copyright infringement claim. The only thing the court ordered, however, was destruction of the infringing PDF by Doe. Doe complied. SMT, however, persisted in its arguments for unmasking. Again, the court refused to turn over Doe's information to the plaintiff, pointing out Doe had complied with the DMCA notice and court order immediately. SMT appealed.

The Appeals Court weighs a lot of factors, but notes this is a question normally addressed before discovery, not after a judgment has already been rendered (mostly) in favor of the party seeking to unmask an anonymous defendant. From the ruling [PDF]:

With the explosion of anonymous Internet speech, courts have begun to develop balancing tests weighing the First Amendment right to anonymous speech against a plaintiff’s interest in unmasking an anonymous defendant. See id. at 1175–76 (compiling balancing tests). All of these cases, however, have dealt with anonymity rights during the discovery process. No case has considered the issue presented here—whether and under what circumstances a court can properly protect a party’s anonymity after judgment. This is an important distinction. The prejudgment cases often deal with a plaintiff’s need to unmask a defendant in order to effect service of process.

[...]

In contrast, the entry of judgment against a Doe defendant largely eliminates these concerns because the plaintiff will have established liability. On the other hand, where the anonymous defendant is determined to have fully complied with the relief granted, there is no practical need to unmask the defendant.

Setting itself up with opposed theories, the court spends the next several questions thinking out loud. Public litigation carries a presumption of open judicial records, which includes identifying information pertaining to both sides of lawsuit. In this case, however, not only is one side still anonymous, but even the plaintiff is unaware of the true identity of the person it's suing. This stands in contrast to sealed cases where both parties are known to each other, but withheld from the general public. The fact that Doe lost a copyright infringement case weighs heavily against his continued anonymity.

[W]here a Doe defendant’s speech is found to be beyond the protection of the First Amendment, countering the presumption will require a showing that the Doe defendant participates in a significant amount of other, non-infringing anonymous speech that would be chilled if his identity were revealed.

This chilling effect could be argued using nothing more than Doe's anti-MLM blog. Certainly, there's plenty of evidence (both judicial and anecdotal) companies -- especially questionable ones -- like to silence critics. One good way of silencing persistent critics is eliminating their anonymity, making them more likely to be sued or otherwise harassed by the entities they criticize.

But the Appeals Court gets hung up on the copyright infringement, even though there's little on the record here showing Doe was a repeat offender. He could have been more careful in his use of the copyrighted MLM manual, but his quick compliance with SMT's demands and district court's order shows he had no intention of thumbing his nose at copyright law.

Doe's compliance seems to weigh against an order for unmasking on remand, even though Doe is definitely the loser in this legal battle. The Appeals Court tries to weave both of these disparate views into a single, mostly-cohesive text, but fails.

We do not agree either that the district court lacks discretion to allow Doe to remain anonymous or that Doe’s legitimate First Amendment right to speak anonymously is collateral to these proceedings. Although Doe’s infringing speech is not entitled to First Amendment protection, that speech occurred in the context of anonymous blogging activities that are entitled to such protection. An order unmasking Doe would therefore unmask him in connection with both protected and unprotected speech and might hinder his ability to engage in anonymous speech in the future.

Further, we do not agree that allowing Doe to remain anonymous would necessarily diminish the impact of the ordered injunctive relief. The dissent’s suggestion that a failure to unmask Doe would obligate the district court and Team’s attorneys to monitor Doe’s activity is inapposite because the district court declined to enter any ongoing injunctive relief. Since Doe has already complied with all aspects of the court’s order, there will be no need for monitoring regardless whether the district court ultimately decides to unmask Doe. Finally, to the extent that the concerns identified by the dissent cut in favor of unmasking Doe, the district court should consider those factors on remand.

The Appeals Court sounds like it might be inclined to let Doe keep his anonymity, but pulls back from that bright line and boots it back to the lower court. The good news, as far as Doe is concerned, is that the lower court already ruled in favor of his arguments against unmasking. Nothing in this ruling suggests the lower court should feel compelled to overturn its earlier decision.

SMT's insistence the infringer/critic be unmasked smacks of pure vindictiveness. Doe has complied with all requests and orders, leaving very little for SMT to truly complain about, especially as the lower court did not issue an order requiring monitoring of Doe's blogging for possible further violations. If SMT is given a win, it will do more than chill Doe's speech. It will chill the speech of anyone criticizing SMT and its business practices. It certainly wouldn't be a good precedent to set: allowing more powerful entities to unmask weaker ones if they can secure some form of judgment in a court. Hopefully, the lower court will come to the same conclusion the second time around.

from the works-in-reverse-too dept

A brief review of all of the articles I've written in these here pages about sweet, delicious alcohol mostly have to do with trademark spats between drink-makers, including many in which I've made the point that it's high time for the USPTO to get a little more subtle when it comes to its alcohol marketplace designations. Beer isn't wine, and wine isn't liquor, and the public looking to buy one of those is quite unlikely to confuse one product for another. The focus of many of those posts was how this lack of distinction between the alcohol markets has resulted in too many aggressive trademark lawsuits and threat letters that hardly seemed necessary.

Few Spirits, the maker of Breakfast Gin, has taken the Michigan-based Gray Skies Distillery to court over the planned December launch of its new whiskey, Breakfast Rye. As reported by MLive.com, Few’s counsel sent a notice in October telling Gray Skies it had “prior rights and registration” to Breakfast Gin, and told it to cease any use of Breakfast Rye. In the lawsuit, it alleged trademark infringement, unfair competition, and violation of Michigan’s Consumer Protection Act. In response, Gray Skies submitted a letter of protest to Few’s pending trademark application.

The Breakfast Gin producer is now seeking an injunction to prevent Gray Skies from selling Breakfast Rye, including damages if it goes up for sale in stores or in bars.

Now, we could spend time talking about just how valid a trademark the word "breakfast" is in the liquor industry -- whether it's generic, whether it's overtly common, and whether or not its actually somewhat descriptive of the flavor or ingredients within each liquor product itself. Frankly, I don't want to do that in this post. The trademark seems valid to me and it certainly isn't striking any well-tuned outrage chords in my psyche.

But one of the defenses proffered by Gray Skies' attorney, Thomas Williams, in its opposition to Few's trademark application shows exactly the problem with a lack of market distinctions in the alcohol industry, except in reverse.

"The use of 'breakfast' to describe alcoholic beverage products that have characteristics, aromas or flavors reminiscent of breakfast foods, is replete in the marketplace," Williams wrote. "For example, Founders Brewing Company markets and sells Founders Breakfast Stout and Founders Canadian Breakfast Stout. Dogfish Head markets and sells Beer for Breakfast Stout."

Except that none of that should actually matter. Few shouldn't be denied a trademark on the word "breakfast" due to the plethora of beer brews using the word in their names. Different alcohol medium, different customer base, different market. That the USPTO doesn't recognize any of that is the problem, of course, but it's disappointing to see the lawyers for a member of the industry ignore all of that over a simple trademark opposition. It's worth noting as well that the same lawyer, Williams, does not trot out this defense in response to the lawsuit Few filed. There instead he relies on the overall trade dress and, remarkably, claims that gin and whiskey customers are discerning enough to discriminate between types of spirits.

One of the factors in trademark law focuses on the likelihood of confusion over a product by consumers. Buyers of craft spirits are very discriminating, Williams said.

"I think we would vigorously dispute that anybody's going to be confused when you put the two products side by side in the market, he said.

Pick a lane, counselor.

By ignoring obvious market distinctions in the alcohol industries, the USPTO has allowed lawyers like Williams to try to play both sides of the argument. On the one hand, oppose a trademark because of similar marks in the beer industry. On the other hand, claim that similar marks within the spirits industry are just fine because gin and whiskey are basically in different markets. A little clarity through common sense any time now, USPTO.

from the there's-a-bit-more-to-look-at-than-that... dept

As you may have heard, Rep. John Conyers recently stepped down from his role as Ranking Member (basically top member of the minority party) on the powerful House Judiciary Committee, and this week has announced his retirement, in response to multiple accusations of sexual harassment. That has kicked off something of an interesting and important debate over who should replace him as ranking member on the Judiciary Committee.

The next in line by seniority is Rep. Jerry Nadler. But right behind him is Rep. Zoe Lofgren. By way of disclosure, I'll note that I've gotten to know Lofgren over the years, and have donated to her election campaign. But even before I'd ever spoken to her, I've noted how she remains one of the few people in Congress who seems to consistently do the right thing on basically all of the issues that we care about at Techdirt. You can see our past coverage of stories involving Lofgren. Most specifically on copyright and surveillance, she hasn't just been on the right side, she's been leading the way. She is, almost single-handedly, the person who stopped SOPA from passing. She has consistently raised important issues and introduced important bills and amendments concerning copyright, NSA surveillance and the CFAA among other things.

Obviously, I think she'd make a great ranking member for the Judiciary Committee (or the chair should the House flip sides in the future). So I was happy to see her recently announce her intention to run for the Ranking Member position against Nadler. Who knows if she'll actually get the position, but I found it odd that upon announcing it, she was immediately attacked by, of all places, The Intercept, which put forth a really strange article accusing Lofgren of being a Google shill. This was strange on multiple levels -- though, I get it. Lofgren gets called a "Google shill" for the same reasons that we do here at Techdirt. Because, even though we frequentlydisagree with Google on a variety of issues, on the whole we support many of the same policies that protect free speech and open innovation online.

That's also true of Lofgren. While she's supported key policies on copyright, online speech, innovation and surveillance, she's similarly pushed back against Google quite frequently as well. She's publicly criticized the company for its lack of diversity. She's voted against a bill to expand H1-B visas that Google supported. She voted against Trade Promotion Authority (which Google stupidly supported -- as noted in one of my links above) that paved the way to moving forward on TPP. On top of that, the tech industry has mostly pushed back on CFAA reform, such as Lofgren's Aaron's Law, because companies want to have it as a tool to use against employees at times. Just recently, Lofgren has started digging into competition inssues in Silicon Valley, warning about the lack of competition and how it's a problem -- a position that, more than likely, Google finds worrisome.

That's just part of why it's so odd that the Intercept, of all publications, would post this article suggesting that Lofgren doesn't belong as the ranking member on the Judiciary Committee just because she's "close" to Google. Even odder, is the fact that the authors of the piece -- two reporters whose work I've long respected, Ryan Grim and Lee Fang -- focus entirely on claiming that Lofgren is a product of Google, while ignoring anything about Nadler. Not only has Nadler been on the wrong side of many of these same key issues, if you consider Lofgren somehow tied to Google (again, incorrectly) then you would similarly have to conclude that Nadler is in the pocket of the legacy entertainment industry, and their ongoing quest to destroy the internet as we know it. If you start looking at Nadler's campaign finance situation, it sure looks like he's the MPAA and the RIAA's favorite Congressman.

In the last campaign cycle, the RIAA gave significantly more to Nadler than any other Democrat. Same with Disney. Same with Sony. Same with Time Warner. Same with Universal Music. Same with the Association of American Publishers. Same with ASCAP. While Viacom gave a bit more to three other members, Nadler was the 4th highest support on the Democratic side. Comcast gave a little more to Conyers, but again, Nadler is near the top of the list. The Grammys have given more to Nadler than any other Democrat, and he repays them by holding events with them all the time.

There's a pretty clear pattern here. If the legacy copyright players want something on the Democratic side, Nadler's their guy. And, maybe that doesn't matter to the Intercept. Maybe it doesn't matter that bad copyright policies that he promotes would have serious downsides to the way the internet works, to free speech and to privacy. Maybe, the Intercept has decided that any possible "connection" to Google is worse than everything else. But considering that the whole creation of The Intercept came about because of the Snowden revelations, and a key focus of The Intercept is to report on the evils of government surveillance, it's kind of surprising that it would publish an article promoting Nadler over Lofgren while ignoring that Nadler has not always been a close friend of surveillance reform. It's true that he's sponsored some reform efforts, including the USA Freedom Act, but just last month he was seen voting against an important amendment brought forth by Lofgren, to end backdoor searches in the ongoing effort to reform Section 702.

So it seems odd that the Intercept is effectively arguing that Nadler would make a better ranking member on Judiciary, even as Lofgren has a stronger record on stopping government surveillance, just because some (falsely) believe that Lofgren is "tied" to Google. And, at the very least, if they're going to tar Lofgren because her views sometimes align with Google's, it seems that it could at least treat Nadler equally by looking into his close connections with the legacy entertainment business.

from the pressing-the-shut-up-button dept

Nothing But the Truth Films (NBT) has a credibility problem. Oh, the irony, I would normally say, except for the fact NBT deals mostly with this sort of "truth."

We present the black and white facts about the geopolitical climate which include Islam, Illuminati, Freemasonry, Cults and more. See how your freedoms are slowly eroding and spread the message with the help of our channel.

So… that's the kind of "truth" we're dealing with, often pronounced "conspiracy theory." J.K. Sheindlin is the person behind NBT Films and the author of a book that has supposedly blown minds of Islam adherents everywhere, resulting in them renouncing their faith on camera.

One popular video on NBT's YouTube channel shows a supposed Islamic man angrily and bitterly decrying the religion after having his eyes opened by Sheindlin's book. But the video isn't what it seems: it's actually footage taken from somewhere else, dealing with an entirely different issue, but with NBT's fabricated subtitles giving the impression Sheindlin's book has unconverted another follower of Islam.

While the video purports to tell the “black and white facts” about someone renouncing his faith because of Sheindlin’s book, the clip in reality does not capture an Arab’s reaction to a controversial book, nor does it capture that person renouncing his faith on live television. Sheindlin added fabricated captions to the video (while pledging to tell “nothing but the truth”) in order to generate buzz for his book The People vs Muhammad.

This footage is dated 2 July 2013, when Egyptian president Mohamed Morsi rejected the military’s ultimatum to leave office. Opposition activist Ihab al-Khouli, the “Arab guy” in the video displayed above, was reacting to Morsi’s speech…

Last month, the conspiracy channel filed a DMCA copyright complaint requesting that Google delist Evon’s article from its search results. That’s according to the Lumen Database, which archives online takedown requests.

The copyrighted work is a video that our company produced, and has been embedded on the following website without our permission. You can see the video embedded on the page, under the section ‘Origin’. We did not give any authorisation for the website ‘Snopes’ to use our video for their news. Therefore, the company Snopes has infringed our copyright.

First off, no one needs permission to embed a YouTube video. If someone wants to prevent others from embedding their videos, they can always turn that option off. Second, Sheindlin's complaint about someone else using "his" video is especially rich considering he's using footage created by someone else without acknowledgment and, on top of that, adding his own subtitles to misconstrue the content of the footage he "borrowed."

It appears Sheindlin is now warning people about his bogus subtitle work (he has more videos purporting to be people denouncing their Islamic faith after reading his book). This annotation has been added to the beginning of the bogus faith rejection video.

If you can't see it, the text box says: "SUBTITLES CHANGED FOR PROMOTIONAL PURPOSES."

At long last, Nothing But the Truth Films finally engages in a close approximation of honesty. Refreshing. And once again, someone looks at a tool created to stop copyright infringement and sees a way to silence a critic.

Finally, for comparison purposes, here's the legitimate, unaltered video with the correct translation:

from the tit-for-tat dept

You might recall that a few years ago, Amazon began banning competing streaming hardware like Apple TV and Google's Chromecast from the Amazon store because these products competed with Amazon's own streaming hardware. At the time, you might also recall that Amazon offered up the historically stupid claim that this was done simply to avoid "customer confusion":

"Over the last three years, Prime Video has become an important part of Prime," Amazon said in the e-mail. "It’s important that the streaming media players we sell interact well with Prime Video in order to avoid customer confusion."

That decision has only resulted in an ever-escalating game of tit for tat that has started to bubble over in recent months. Around three months ago, YouTube decided to block YouTube from working on Amazon's Echo Show hardware, pushing the bogus claim it was due to a "broken user experience." In response, Amazon expanded its blacklist of Google products by refusing to sell Google Nest hardware as well. This was already bad enough, but the escalating game of "who can be the most obnoxious to paying customers" was taken to yet another level this week.

For a while, Amazon managed to create a workaround that directed Echo Show users to the web version of YouTube, but Google/YouTube managed to find a way to block that too as of today. YouTube is also now informing owners of Amazon's Fire TV products that YouTube will no longer work on that hardware either, starting January 1. Needless to say, this is creating a broken experience on both hardware platforms, and customers are clearly annoyed:

So Google's feud with Amazon just reached my living room. Got this screen when I launched YouTube on my Amazon Fire TV. pic.twitter.com/vtmcuBTtE9

In a statement, Google all but admits that the two companies are engaged in a giant game of jackass patty cake:

"​We’ve been trying to reach agreement with Amazon to give consumers access to each other's products and services. But Amazon doesn't carry Google products like Chromecast and Google Home, doesn't make Prime Video available for Google Cast users, and last month stopped selling some of Nest's latest products. Given this lack of reciprocity, we are no longer supporting YouTube on Echo Show and FireTV. We hope we can reach an agreement to resolve these issues soon."

There are numerous problems here. One being that none of this is really necessary, and that instead of settling their grievances like professionals, the two companies thought it would be a good idea instead to engage in an epic attempt at pettiness which harms openness, innovation, consumer trust, and the consumer experience. But this is also another example of how in the modern era, you don't really own the products you think you're buying, with companies more than happy to eliminate integral functionality at a moment's notice -- without much concern for the end user.

The dispute is so idiotic, it even prompted US Telecom, an AT&T-funded ISP lobbying organization, the opportunity to take a few pot shots at Google in a statement it circulated to the media yesterday:

"Broadband ISPs are committed to providing an open internet for their customers, including protections like no content blocking or throttling. Seems like some of the biggest internet companies can’t say the same. Ironic, isn’t it?"

When you're being trash-talked by what's currently the most-hated industry in America, you know you have a problem. Granted, US Telecom is engaged in some major conflations here. One, Google hasn't really clearly supported net neutrality since around 2010 or so, making this obnoxious, but not necessarily hypocrisy. Two, Amazon customers at least have the option to use other hardware, something you can't say about broadband subscribers, who usually only have access to one ISP at the FCC's 25 Mbps broadband definition threshold. This isn't a net neutrality violation, it's just stupid.

There really is no winner here. Google and Amazon could simply settle their differences like countless businesses do every hour of every day. Instead, they've decided that the best course of action was a downward spiral that punishes millions of consumers simply because the two companies' executives are unwilling behave like functional adults.